Question 8 Chapter 4 – Unimax Class 12 Part 1 – 2021

Question 8 Chapter 4 - Unimax Class 12 Part 1 - 2021

Question 8 Chapter 4 – Unimax Class 12 Part 1

8. A and B are partners sharing Profits and losses in ratio of 3 : 2. Their Balance Sheet is showing a balance of Rs. 50000 in General Reserve Account and Rs. 40000 (Cr.) in Profit and Loss Account. They now decide to share future profits equally. Instead of closing the General Reserve Account and Profit and Loss Account, it is decided to record an adjustment entry for the same. You are required to record the necessary adjustments entry to give effect to the above arrangement.

The solution of Question 8 Chapter 4 – Unimax Class 12 Part 1

Old Share New Share Difference
A          3/5 1/2 3/5_1/2=1/10 (Sacrifice)
B          2/5 1/2 2/5_1/2=[1/10] (Gain)

B will pay to A, Rs. 9000 ( Rs. 90000 x 1/10)

Journal

Date Particulars   L.F. Debit Credit
  B’s Capital A/c Dr.   9,000  
    To A’s Capital A/c       9,000
  (Being adjustment entry Passed for treatment of General Reserve and Profit & Loss A/c on change in constitution)        
           

What is Partnership – Meaning and its Types

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

 

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